Strong banking sector

The aggregate performance indicators announced by local banks from time to time reflect the Saudi economy’s strong performance and ability to maintain the positive outlook about the sovereign rating, as announced earlier by Fitch, which has praised the Saudi banking system. It recently ranked the Kingdom’s banking system fourth in the world. It is not surprising in any way that the Saudi banks recorded their highest profits ever in 2017. According to a report published in Al-Riyadh Arabic newspaper, sister publication of Riyadh Daily, profits have jumped to about SR 43.7 billion, compared to SR 40.4 billion in 2016, an increase of 8.2 percent. Growth in the banking sector is an indicator of sustained cash liquidity at rates commensurate with the economic growth. It is in line with a constant monetary policy, consistent exchange rate for the Saudi riyal, and steady market prices, as announced by the Saudi Arabian Monetary Authority (SAMA). Such growth will definitely support socioeconomic development via the strong solvency of national banks and the advancement of modern banking services that meet the requirements of the various sectors. During the past few years, the Saudi banks have been successful in boosting their business and regulatory environment to strengthen their positions. As a result, the Kingdom has become one of the few countries succeeding in applying the Basel Standards pertaining to capital requirements calculation, supervisory audits, transparency, disclosure, borrowing-to-capital ratio and percentages of liquidity and reserves. Owing to the supervisory and regulatory policies adopted by SAMA, the banks have also been successful in encountering the fluctuating international economic cycles. This has contributed to the stability of the Saudi economy, availability of finance for the private and public sectors, as well as the government’s specialist borrowing institutions. The volume of loans rendered by banks, non-financial governmental institutions and the private sector has reached SR 1,440.4 billion in 2017. In this respect, there is a need to increase awareness and control by SAMA and banks to familiarize clients with their rights and duties so that all beneficiaries perform their banking transactions transparently, justly, cost-effectively, and with assured quality. It is necessary to spread a financial culture and promote the habit of savings and thriftiness.

Related News

Comments.

Name *

Email *

Comment *

Weather forecast.

Ads.

Navigation.

Riyadh Daily, published by the Al-Yamamah Press Establishment, is the first English daily published from the Saudi capital. Along with its sister publication, Al-Riyadh Arabic newspaper, Riyadh Daily has a long history in the Kingdom’s media industry. It was first published as a newsletter in the 1960s before it was developed into a broadsheet in 1985.